If you have some US dollars and are considering investing in Apple stock, you don't take the price of oil into account (unless you're also considering investing in oil).

In the same way if you have Bitcoin and are considering investing in SDICE, you don't take the price of US dollars into account (unless you're also considering investing in fiat).

Apple is not denominated in oil, or it would have to be taken into account.

If the Bitcoin economy holds $1,000,000,000 of wealth at 11,000,000 units, each bitcoin is worth about $91. Assuming SD is worth $10,000,000, that would make the business worth 110,000 bitcoins.

If the exchange rate doubles, making the Bitcoin economy worth $2,000,000,000, but SD remains at the same absolute valuation, it should then be worth 55,000 bitcoins.

SD has been estimated to be worth $100-200,000,000, which I think is appropriate. This means that at a current economy size of $1 billion, SD should be worth 10-20% of the entire stock of bitcoins, or 1.1-2.2mm BTC. Therefore, the share price should be about 3-6x higher than the 0.0033 level. Hypothetically.

Of course, there are other factors, but that shows the USD relation due to both it and Bitcoin being concurrent measures and stores of value.

No, no... That's like saying "USD are denominated in EUR". (And let's be frank, we all know that USD is really denominated in CNY!)

APPL is denominated in USD.SD is denominated in BTC.

You could buy oil with USD, but that doesn't mean that oil is also denominated in APPL.

Temperature is measured using several different metrics, mostly Fahrenheit, Celsius, and Kelvin. Likewise, wealth is measured by numerous yardsticks, primarily USD, EUR, JPY, etc. Bitcoins and dollars are simply different methods of measuring and tracking wealth.

Imagine a sponge in a swimming pool. The sponge absorbs 1% of the water in the pool. Now replace the pool with a lake; the sponge might hold only 0.01% of that water.

In the above example, the pool water is all the wealth in the Bitcoin system and the sponge is SD. The lake is the wealth in the USD economy. If Bitcoin and USD switch places, SD does not change - only its share of the overall economy does. So unless SD grows to maintain its proportion to the total amount of wealth in the system, the share price will decline relative to the metric - in our case, BTC.

Ask yourself whether a gambling site can comprise 10% of the Bitcoin economy for years when there are so many businesses jumping into the system.

In the above example, the pool water is all the wealth in the Bitcoin system and the sponge is SD. The lake is the wealth in the USD economy. If Bitcoin and USD switch places, SD does not change - only its share of the overall economy does. So unless SD grows to maintain its proportion to the total amount of wealth in the system, the share price will decline relative to the metric - in our case, BTC.

Ask yourself whether a gambling site can comprise 10% of the Bitcoin economy for years when there are so many businesses jumping into the system.

A corollary of this is you shouldn't buy any bitcoin business shares. If bitcoin succeeds their BTC share price will almost certainly dive due to deflation. It might be soaring according to the USD yardstick, but you would have been better off just holding BTC. If bitcoin fails the shares will probably be worthless. Actually this isn't quite right; the bitcoin shares would be worth buying if their dividend rate makes up for the appreciation of the BTC, which probably means extraordinarily large.

You are a warlord in the outskirts of the known world struggling to establish a kingdom in the wild lands.

In the above example, the pool water is all the wealth in the Bitcoin system and the sponge is SD. The lake is the wealth in the USD economy. If Bitcoin and USD switch places, SD does not change - only its share of the overall economy does. So unless SD grows to maintain its proportion to the total amount of wealth in the system, the share price will decline relative to the metric - in our case, BTC.

Ask yourself whether a gambling site can comprise 10% of the Bitcoin economy for years when there are so many businesses jumping into the system.

A corollary of this is you shouldn't buy any bitcoin business shares. If bitcoin succeeds their BTC share price will almost certainly dive due to deflation. It might be soaring according to the USD yardstick, but you would have been better off just holding BTC. If bitcoin fails the shares will probably be worthless. Actually this isn't quite right; the bitcoin shares would be worth buying if their dividend rate makes up for the appreciation of the BTC, which probably means extraordinarily large.

You are right. I thought sdice would be a good protection against collapsing btc value, but that was not the case as the sdice shares did not go up when btc dropped drasticly. So when btc goes to the moon, you are screwed with sdice (or any company) as it just doesn't go up and instead tanks in btc value. And when btc collapses, the sdice valuation also does not go up to compensate so your losing too. The only time sdice has outperformed btc was when btc prices were trending trending sideways or slowly up, as was the case from the last half year of 2012. Let's hope we get that again as I'd like to see sdice regain some of it's btc value.

Part of the problem is the spectre of 87 million shares out there ready to be sold at any time. Back when there was a healthy buy/sell market, 3 million shares were sold by SD (not offered, sold onto the market). So who's to know when all selling opportunity evaporates since it is unknown publicly how SD will act. This is akin to the blockchain randomly awarding 100k bitcoins to the winner of a block, it screws with markets when all information isn't given beforehand, and it would make sense to just keep tiering up, ipo at .0032, .0034, .0037, price rose to like .006, so why not put up:

1 million at .011 million at .011...1 million at .02

Now SD would have a plan to sell their next 10 million shares onto the market at a natural rate as long as they prove themselves, and they have always seemed pretty confident about what they are doing. It may have taken years but at least they didn't dry up the market. As it turned out, investors are stuck with their shares now, hoping their dividends are worth it.

Best Bitcoin supported browser game:Minethings: Dig, Trade, and Fight your way to influence!